Bankunited, Inc. · NYSE:BKU
Bankunited — Q1 2021 Earnings Presentation
33 slides from Bankunited's earnings presentation, Apr 22, 2021
Slide 1: Q1 2021 – Supplemental Information
April 22, 2021 Q1 2021 – Supplemental Information Exhibit 99.2
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect the current views of BankUnited, Inc. (“BankUnited,” “BKU” or the “Company”) with respect to, among other things, future events and
Slide 3: Financial Highlights
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Slide 4: Strong Quarterly Results in a Challenging Environment
Strong Quarterly Results in a Challenging Environment 4 Operating results Continued improvement in deposit mix Asset Quality Robust capital levels • EPS for the quarter of $1.06 • Annualized ROE for the quarter of 13.2% and ROA of 1.14% • Net interest income grew by $3 million linked quarter and $16
Slide 5: Highlights from First Quarter Earnings
Highlights from First Quarter Earnings 5 Key Highlights Reflective of an improving economic forecast 73% YoY non-interest DDA growth. 11% YoY deposit growth, primarily from non-interest bearing. Spot APY on total deposits declined to 0.27% at March 31, 2021 (1) PPNR is a non-GAAP financial measure.
Slide 6: Continuing to Transform our Deposit Mix
Continuing to Transform our Deposit mix ($ in millions) 6 $7,347 $7,542 $6,731 $5,888 $4,807 $3,784 $10,622 $10,324 $10,590 $11,003 $12,660 $12,885 $2,131 $2,536 $2,866 $2,917 $3,020 $3,097 $4,295 $4,599 $5,883 $6,789 $7,009 $7,966 $24,395 $25,001 $26,070 $26,597 $27,496 $27,732 12/31/19 3/31/20 6/3
Slide 7: Prudently Underwritten and Well-Diversified Loan Portfolio
Prudently Underwritten and Well-Diversified Loan Portfolio At March 31, 2021 ($ in millions) 7 Loan Portfolio Over Time CRE C&I Non-owner Occupied 73% Multi- family 23% Construction and Land 4% Commercial and Industrial 59% Owner Occupied 28% SBA PPP 13% Lending Subs Residential Loan Product Type Pi
Slide 8: Allowance for Credit Losses
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Slide 9: CECL Methodology
CECL Methodology 9 Underlying Principles Economic Forecast Key Variables • The ACL under CECL represents management’s best estimate at the balance sheet date of expected credit losses over the life of the loan portfolio. • Required to consider historical information, current conditions and a reasona
Slide 10: Drivers of Change in the ACL
Drivers of Change in the ACL 10 ACL 12/31/20 ACL 3/31/21 Assumption Changes Net Portfolio Migration Portfolio Changes Economic Forecast Net Charge- Offs Change in Qualitative Overlay ($ in millions) % of Total Loans 1.08% 0.95% • Updated prepayment assumptions • Updates to certain assumptions for cr
Slide 11: Allocation of the ACL
Allocation of the ACL 11 ($ in millions) (1) Non-performing loans and assets include the guaranteed portion of non-accrual SBA loans totaling $48.2 million and $51.3 million or 0.21%, and 0.22%, of total loans and 0.14%, and 0.15% of total assets, at March 31, 2021 and December 31, 2020. (2) ACL to
Slide 12: Loan Portfolio and Credit
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Slide 13: Loan Portfolio – Geographic Distribution
Loan Portfolio – Geographic Distribution At March 31, 2021 Commercial (1) Residential CRE (1) Includes PPP, MWL, BFG and Pinnacle CA 31% FL 10% NY 23% Other 36% FL 54% NY Tri-State Area 37% Other 9% FL 39% NY Tri-State Area 23% Other 38% 13
Slide 14: Loan Portfolio – Granular, Diversified Commercial & Industrial Portfolio
14 Loan Portfolio – Granular, Diversified Commercial & Industrial Portfolio At March 31, 2021 ($ in millions) • Includes $1.9 billion of owner- occupied real estate • Some key observations: • Educational services – well established private colleges, universities and high schools • Transportation and
Slide 15: Loan Portfolio – Commercial Real Estate by Property Type
Loan Portfolio – Commercial Real Estate by Property Type At March 31, 2021 Property Type Balance FL NY Tri State Other Wtd. Avg. DSCR Wtd. Avg. LTV Non- Performing Office 2,078$ 59% 26% 15% 2.39 57.1% 5$ Multifamily 1,689 34% 65% 1% 1.78 56.8% 15 Retail 1,292 53% 40% 7% 1.47 57.8% 22 Warehouse/Indus
Slide 16: Loan Portfolio – Deferrals and Modifications
16 Loan Portfolio – Deferrals and Modifications At March 31, 2021 ($ in millions) • Loans subject to COVID related deferral or modification under the CARES Act totaled $762 million or 3% of the total loan portfolio at March 31, 2021. By comparison, at the end of Q2 2020, we reported that we had gran
Slide 17: Loan Portfolio – Segments Identified for Heightened Monitoring
Loan Portfolio – Segments Identified for Heightened Monitoring At March 31, 2021 Moderate exposure to sectors most impacted by the pandemic ($ in millions) • 76% of commercial loans deferred or modified and 52% of criticized and classified assets are in these sub-segments Portfolio Balance % of Tota
Slide 18: Loan Portfolio – Retail
Loan Portfolio – Retail At March 31, 2021 ($ in millions) Retail - Commercial Real Estate Property Type Balance Currently Under Short-Term Deferral CARES Act Modification Retail - Anchored 634$ -$ 6$ Retail - Unanchored 603 18 13 Construction to Perm 7 - - Gas Station 24 - - Restaurant 24 - - 1,292$
Slide 19: Loan Portfolio – BFG Franchise Finance
Loan Portfolio – BFG Franchise Finance At March 31, 2021 ($ in millions) Portfolio Breakdown by Concept Restaurant Concepts Balance % of BFG Franchise Currently Under Short- Term Deferral CARES Act Modification Burger King 61$ 12% -$ -$ Popeyes 28 5% - - Dunkin Donuts 27 5% - - Jimmy John's 19 4% -
Slide 20: Loan Portfolio – Hotel
Loan Portfolio – Hotel At March 31, 2021 ($ in millions) • 74% of our exposure is in Florida, followed by 16% in New York • Includes $60.3 million in SBA loans • All hotel properties in Florida and two of three properties in New York are now open Exposure by Flag Marriott $170 27% Independent $162 2
Slide 21: Credit Quality – Residential
Credit Quality – Residential At March 31, 2021 High quality residential portfolio consists of primarily prime jumbo mortgages with de-minimis charge- offs since inception as well as fully government insured assets FICO Distribution(1) Breakdown by LTV(1) Breakdown by Vintage(1) (1) Excludes governme
Slide 22: Asset Quality Metrics
Asset Quality Metrics Non-performing Loans to Total Loans Non-performing Assets to Total Assets Net Charge-offs to Average Loans(1) (1) YTD net charge-offs, annualized at March 31, 2021. 0.88% 0.85% 0.86% 0.84% 1.02% 1.00% 0.68% 0.64% 0.67% 0.66% 0.80% 0.79% 0.00% 0.25% 0.50% 0.75% 1.00% 1.25% 12/31
Slide 23: Non-Performing Loans by Portfolio Segment
Non-Performing Loans by Portfolio Segment ($ in millions) (1) Includes the guaranteed portion of non-accrual SBA loans totaling $48.2 million, $51.3 million, $43.6 million, $45.7 million, $49.1 million, and $45.7 million at March 31, 2021, December 31, 2020, September 30, 2020, June 30, 2020, March
Slide 24: Criticized and Classified Loans
Criticized and Classified Loans ($ in millions) Commercial Real Estate Commercial & Industrial (2) Franchise Finance(1) Equipment Finance SBA(3) (1) Substandard non-accruing and doubtful includes $0.5 million of loans rated doubtful at March 31, 2021. (2) Substandard non-accruing and doubtful includ
Slide 25: Criticized and Classified – CRE by Property Type
Criticized and Classified – CRE by Property Type ($ in millions) Office Multifamily Retail Warehouse/Industrial Hotel Other $0 $50 $100 $150 $200 $250 $300 $350 $400 $450 $500 $0 $50 $100 $150 $200 $250 $300 $350 $400 $450 $500 $0 $50 $100 $150 $200 $250 $300 $350 $400 $450 $500 $0 $50 $100 $150 $20
Slide 26: Criticized and Classified – BFG Franchise Finance
Criticized and Classified – BFG Franchise Finance ($ in millions) Restaurant Concepts (1) Fitness Concepts Other (1) Substandard non-accruing and doubtful includes $0.5 million of loans rated doubtful at March 31, 2021. $0 $20 $40 $60 $80 $100 $120 $140 $160 12/31/19 3/31/20 6/30/20 9/30/20 12/31/20
Slide 27: Asset Quality – Delinquencies
Asset Quality – Delinquencies ($ in millions) Commercial(1) CRE Residential (2) (1) Includes lending subsidiaries (2) Excludes government insured residential loans. $0 $20 $40 $60 $80 $100 $120 $140 12/31/19 3/31/20 6/30/20 9/30/20 12/31/20 3/31/21 $0 $20 $40 $60 $80 $100 $120 $140 12/31/19 3/31/20
Slide 28: Investment Portfolio
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Slide 29: Investment Securities AFS
29 Investment Securities AFS ($ in thousands) The AFS debt securities portfolio of $9.1 billion was in a net unrealized gain position of $51.5 million at March 31, 2021 Portfolio Composition Ratings Distribution Gov 35% AAA 58% AA 5% A 2% US Government and agency 32% Private label RMBS and CMOs 13%
Slide 30: Investment Securities – Asset Quality of Select Non-Agency Securities
30 Investment Securities – Asset Quality of Select Non-Agency Securities At March 31, 2021 Strong credit enhancement levels on CLOs and CMBS AAA 90% AA 7% A 3% Rating Min Max Avg AAA 29.4 99.1 43.0 12.2 AA 31.1 60.4 39.9 11.3 A 24.5 69.8 39.3 10.5 Wtd. Avg. 29.3 95.5 42.6 12.1 Wtd. Avg. Stress Scena
Slide 31: Non-GAAP Financial Measures
Non-GAAP Financial Measures
Slide 32: Non-GAAP Financial Measures
32 Non-GAAP Financial Measures PPNR is a non-GAAP financial measure. Management believes this measure is relevant to understanding the performance of the Company attributable to elements other than the provision for credit losses and the ability of the Company to generate earnings sufficient to cove
Slide 33: Non-GAAP Financial Measures (continued)
33 Non-GAAP Financial Measures (continued) ACL to total loans, excluding government insured residential loans, PPP and MWL is a non-GAAP financial measure. Management believes this measure is relevant to understanding the adequacy of the ACL coverage, excluding the impact of loans which carry nomina